RED Fund can help boost exports significantly, Says Experts

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ISLAMABAD: Export Development Fund (EDF) is a big and untapped opportunity for the businesses to help boost country’s exports. If reforms measures taken in consultation with all stakeholders coupled with effective monitoring mechanism and impact assessments of the project proposals, the EDF will help boost exports significantly and improve export competitiveness of the country.

Experts said this during the second Public Private Dialogue Forum (PPDF) Round table Meeting to Discuss Export Development Fund (EDF): Prospects for the Private Sector, organised by the Sustainable Development Policy Institute (SDPI) in collaboration with The United States Agency for International Development (USAID) funded Pakistan Regional Economic Integration Activity (PREIA) project.

Executive Director, Export Development Fund (EDF), Syed Abbas Mehdi said since its establishment in 1991 EDF aim is to address bottlenecks faced by the exporters and producers of export goods & services in Pakistan with a view to increase the performance of export sector. He said that EDF is now under revival which previously only extends financial support on proposals and initiatives by exporters to promote export and there was no mechanism of monitoring and impact assessment of the project proposals. In a bid to reform the fund, EDF has now establish a secretariat last year to set the strategic direction of the fund and urged the business community and exporters to provide their suggestions, inputs and proposals to reform the fund. He also urged the exporters to submit quality proposals and get maximum benefits from the fund.

Secretary of the Board of Export Development Fund (EDF) and Joint Secretary, Ministry of Commerce, Maria Kazi on the occasion said our private sector and exporters lack innovation and little focus on research and development, as EDF never receive any proposal which is innovative in nature and cater the need and demand of international market. She strongly urged the private sector to develop proposals based on 4th Industrial Revolution (4IR), and innovative on technological front. In order to be competitive and relevant in international markets, our exporters need to be smarter and innovative, she added. She said there is little awareness among the exporters regarding the export development fund, whereas, the fund has little capacity to reach out to the potential exporters.

Joint Executive Director, SDPI, Dr. Vaqar Ahmed said to reform the EDF and its various processes, it is important to select board members of EDF from the private sector on competitive basis, policy think tanks may be encourage to apply directly who in turn can help in bridging capacity gaps at business associations, and private sector may be informed how government will bring greater transparency and certainty in selection of proposals by business associations. He said that ministry of commerce should help EDF in augmenting internal human resource capacities which in turn could better equip EDF to do impact evaluation of its work and also put in place a monitoring and evaluation system to track progress of grantees. Any barriers to smooth flow of funds to select beneficiaries may be evaluated by ministry of Finance and Trade Development Authority (TDAP), he added.

“It will be ideal if EDF money is dedicated to creating new and innovative products or bringing sophistication to existing products”, said Dr Vaqar adding private sector should recommend how EDF can help the implementation of forthcoming strategic policy framework. Additionally, non-traditional export markets may be explored and non-traditional export products may be favored. He said that it will be important to dedicate some part of the EDF to developing export potential of small and medium enterprises (SMEs) in less developed districts, for example in Baluchistan and Khyber-Pakhtunkhwa. EDF should adopt IT based procedures and submission and processing of all proposals should be online, he recommended.

Chief of Party, USAID-PRIEA project, Hussan Bano Barki while explaining different aspects of Pakistan Regional Economic Integration Activity (PREIA) project to promote and facilitate trade in Pakistan said revival and introspection within EDF is a welcome move, where EDF now will be focusing on monitoring and impact assessments of the proposal and not just receiving proposals and disbursements of funds. She said with newly established secretariat, EDF will be working in more cohesive way, which will help improve accountability and transparency mechanism. She urged EDF to have strategic objectives to support government policies on trade and industries, which mostly remained un-implemented.

Chief of Exports, Federal Board of Revenue (FBR), Iqbal Munir urged the business community and exporters in particular to submit their proposals and recommendations for forthcoming federal budget, especially regarding to export promotion schemes. He informed that the FBR has amended the relevant SRO for promotion of exports and fully automated the all business-related processes including the export promotion schemes to help facilitate businesses. President Islamabad Chamber of Commerce and Industries (ICCI), Muhammad Ahmed said urged the EDF to expedite its processes and procedures for proposal selections, approval and disbursement of funds. President, Rawalpindi Chamber of Commerce and Industries (RCCI), Dr Shumail Daud while highlighting the structural issues of EDF stressed the need for provision of leadership role to private sector members in the board of EDF which may help resolve the issues of the private sector.

Director General, Competition Policy, Competition Commission of Pakistan (CCP) Ahmed Qadir offer EDF help and support in raising awareness among business community on export development fund and building capacity through training of EDF for improve procedures. Director, Economic Policy Review Department, State Bank of Pakistan (SBP), Dr Umar said though Pakistan’s economy is in stabilisation phase, our country is confronting the issue of small economy syndrome, where exporters get little price impact in international market. He said EDF and businesses need to work on global value chain, where SBP is ready to help promote businesses and exports.

Engr. Altaf Hussain from Engineering Develop Board (EDB) stressed the need for some EDF allocation in overlooked sectors including power equipment, sanitary fittings, household utensils and cutlery, home appliances and casting forging for export promotions and import substitution. Vice Chairman, the Surgical Instruments Manufacturers Association of Pakistan, Waqas Raza proposed EDF to help establish long-awaited high-tech laboratory and common facility center for certification of their products, which would help boost exports of surgical instruments of the country. Chairman, Faisalabad Garment City Company, Rehan Naseem Bharara proposed allocations of some EDF funds in perspective of women empowerment through funding the proposals by small and medium enterprises (SMEs) led by women. Representative from the textile sector stressed the need for consistent strategic direction of textile industry, like China and India’s five years plans for their respective textile sector promotion, to help textile sector thrive.

The meeting was also attended by the representatives of All Pakistan Textile Mills Association (APTMA), Pakistan Business Council (PBC), United Nations Industrial Development Organisation (UNIO), World Bank, Pakistan Institute of Development Economic (PIDE), Pakistan Institute of Trade and Development (PITD) Pakistan Handicraft Association, and members of different business association.

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